DuPont Decomposition
Why does JKCEMENT earn its ROE?
Breaking down Return on Equity into profitability, efficiency, and leverage.
ROE = Net Margin × Asset Turnover × Equity Multiplier
14.2% = 7.5% × 0.69 × 2.75
Latest: FY2025
Profitability
Net Margin
7.5%
4.0% →7.5%
How much profit per ₹ of revenue
Efficiency
Asset Turnover
0.69x
0.21x →0.69x
Revenue per ₹ of assets
Leverage
Equity Multiplier
2.75x
2.83x →2.75x
Assets funded by equity vs debt
Trend Analysis
ROE improved by 11.9 pp over 3 years. Driven by net margin improving (4.0% → 7.5%), asset turnover improving (0.21x → 0.69x).
Historical Decomposition
Last 3 years
| Year | Revenue | PAT | Net Margin | Asset TO | Leverage | ROE |
|---|---|---|---|---|---|---|
| FY2023 | ₹0Cr | ₹0Cr | 4.0% | 0.21 | 2.83 | 2.4% |
| FY2024 | ₹0Cr | ₹0Cr | 7.1% | 0.21 | 2.76 | 4.1% |
| FY2025 | ₹0Cr | ₹0Cr | 7.5% | 0.69 | 2.75 | 14.2% |
How to read DuPont
- • Rising ROE from margin = pricing power, operational improvement (good)
- • Rising ROE from turnover = better asset utilization (good)
- • Rising ROE from leverage = more debt, amplified risk (caution)
- • Falling ROE across all three = structural deterioration (red flag)
DuPont decomposition from audited annual financials. Factual analysis, not investment advice.